Preproposal statement of inquiry was filed as WSR 05-20-060.
Title of Rule and Other Identifying Information: WAC 415-111-220 How do I choose a defined contribution rate?
Hearing Location(s): Department of Retirement Systems, 6835 Capitol Boulevard, Conference Room 115, Tumwater, WA, on January 10, 2006, at 1:30 p.m.
Date of Intended Adoption: January 11, 2006.
Submit Written Comments to: Leslie L. Saeger, Rules Coordinator, Department of Retirement Systems, P.O. Box 48380, Olympia, WA 98504-8380, e-mail firstname.lastname@example.org, fax (360) 753-3166, by 5:00 p.m., on January 10, 2006.
Assistance for Persons with Disabilities: Contact Leslie Saeger, Rules Coordinator, by December 30, 2005, TDD (360) 664-7291, TTY (360) 586-5450, phone (360) 664-7291.
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: This amendment clarifies that once a PERS or SERS Plan 3 member chooses a contribution rate, or is assigned the base rate of 5%, the member may not change that contribution rate unless he/she changes employers. This amendment is required by an IRS decision on the tax-qualified status of PERS Plan 2 and 3 and SERS Plan 2 and 3. (RCW 41.34.090).
Statutory Authority for Adoption: RCW 41.50.050(5).
Statute Being Implemented: RCW 41.34.040 and 41.34.090.
Rule is not necessitated by federal law, federal or state court decision.
Name of Proponent: Department of Retirement Systems, governmental.
Name of Agency Personnel Responsible for Drafting: Leslie Saeger, P.O. Box 48380, Olympia, WA 98504-8380, (360) 664-7291; Implementation and Enforcement: Dave Nelsen, P.O. Box 48380, Olympia, WA 98504-8380, (360) 664-7291.
No small business economic impact statement has been prepared under chapter 19.85 RCW. These rules have no effect on businesses.
A cost-benefit analysis is not required under RCW 34.05.328. The Department of Retirement Systems is not one of the named departments in RCW 34.05.328.
November 29, 2005
AMENDATORY SECTION(Amending WSR 04-02-004, filed 12/24/03, effective 1/1/04)
WAC 415-111-220 How do I choose a defined contribution rate? (1) Contribution rates: If you are a member of the Teachers' Retirement System (TRS) Plan 3, the School Employees' Retirement System (SERS) Plan 3, or the Public Employees' Retirement System (PERS) Plan 3, you are required to contribute from your compensation according to one of the following rate structures:
|Base Rate||Additional Rate||Total Contribution Rate|
|Up to age 35||5.0%||0.0%||5.0%|
|Age 35 to 44||5.0%||1.0%||6.0%|
|Age 45 and above||5.0%||2.5%||7.5%|
|Up to age 35||5.0%||1.0%||6.0%|
|Age 35 to 44||5.0%||2.5%||7.5%|
|Age 45 and above||5.0%||3.5%||8.5%|
(3) Where do I get the form to make my choice? Your employer must provide the appropriate form to choose a contribution rate if you are enrolling in Plan 3 or transferring from Plan 2 to Plan 3.
(4) When do I have to choose? You must choose a contribution rate within ninety calendar days from your date of hire in an eligible position. However, if you are transferring from Plan 2 to Plan 3, you must choose a contribution rate at the same time you transfer. The ninety-day period does not apply to a member transferring from Plan 2 to Plan 3.
(5) When do contributions begin?
(a) Once you choose a contribution rate, contributions will begin the first day of the pay cycle in which you make the choice.
(b) If the employer advises the department that you should be reported into Plan 3 membership retroactively, the ninety-day period starts from the date it is discovered that you should have been reported. The department will decide which date to use.
(6) What if I work for more than one employer? If you are a Plan 3 member working in eligible positions for more than one employer, you may select a different contribution rate with each employer.
(7) What happens if I do not make a choice? Under RCW 41.34.040, you will be assigned a base rate of 5% (Option A) if:
(a) You are a new employee or changing your employer, and do not choose a contribution rate within the ninety-day election period described in subsection (4) of this section; or
(b) You are transferring from Plan 2 to Plan 3 and do not choose a contribution rate at the time of transfer. Contributions required under subsection (a) or (b) will begin the first day of the pay cycle in which you are assigned to Option A.
(8) Can I change my contribution rate?
Except as provided in (c) of this subsection, once
you choose a contribution rate or are assigned the base rate
of 5% (Option A), you cannot change your contribution rate
unless you change employers.)) If you are a PERS 3 or SERS 3
member, once you choose a contribution rate or are assigned
the base rate of 5% (Option A), you cannot change that
contribution rate unless you change employers. This rule is
required by an IRS decision on the tax qualified status of
PERS 2 and 3 and SERS 2 and 3.
(b) Each time you change employers, you must choose a new contribution rate within ninety days or you will be assigned a base rate of 5% (Option A). No contributions will be taken until you choose a rate or until the ninety-day period has elapsed, whichever occurs first.
(c) Each January, TRS Plan 3 members may change their contribution rate option by providing written notification to their employer as described in WAC 415-111-110(1).
[Statutory Authority: RCW 41.50.050(5) and 41.34.040. 04-02-004, § 415-111-220, filed 12/24/03, effective 1/1/04; 01-15-038, § 415-111-220, filed 7/13/01, effective 7/26/01. Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, § 415-111-220, filed 12/12/00, effective 1/12/01.]